Dayton strikes cordial tone with business

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Conciliatory speech highlights education reform, job creation 

Standing in front of nearly 1,000 of the state’s top business leaders and GOP political influencers is likely not Gov. Mark Dayton’s favorite place to be. The Democratic governor has been at odds with business groups since he first ran for election in 2010, when they sunk millions into trying to defeat him. The tenor of the relationship hasn’t improved much since he was elected: Businesses are calling on the governor to repeal a series of business-to-business tax increases passed during the last legislative session.

At the Minnesota Chamber of Commerce annual pre-session dinner in 2011, Dayton chided the crowd for opposing tax increases in the face of a multi-billion dollar budget deficit. In an appearance before chamber members at their lobby day at the Capitol this year, Dayton aggressively defended his plan to increase taxes on high-wage earners in the state.  But Dayton struck a cordial tone at the Minnesota Business Partnership annual dinner Monday night, focusing the conversation on job creation, education reform and other issues where the liberal governor has found common ground with the state’s business leaders.

“I realize that most of you are unhappy with my raising some taxes to balance the state’s budget last spring. I was just as unhappy about the need to do so,” Dayton told the sold-out crowd at the Minneapolis Convention Center. “But there’s good news ahead. Under current trends, our state’s economic future looks even better. The most recent state budget forecast predicts we will start the next biennium beginning July 1, 2015 with a $728 million surplus… If I’m in office, I want to devote much of that surplus to serious tax reductions.”

“I don’t expect you to believe this,” Dayton added. “Just remember it.”

Education and economic development

The governor and the other speakers at the event, who included former Florida Gov. Jeb Bush, kept the conversation mostly focused on education reform, an area of policy where the governor and business groups have found some agreement. Dayton cited his work with Republicans to pass evaluations for teachers and principals, as well as Democrats’ passage of all-day kindergarten funding during the last legislative session.

“Legislators from both parties played important leadership roles and deserve to share the credit for raising the standards for students, teachers, principals, achievement and testing,” Dayton said. “Our schools deserve still better, and they’re going to get it.”

Dayton is also sharpening what will likely be a prominent theme in his 2014 campaign for reelection: job creation. The governor threw out the exact number of jobs that he said have been created in the state of Minnesota since he took office: 122,200. Dayton has made public subsidies for business a focus of his first term, and he cited projects such as the Mayo Clinic’s Destination Medical Center in Rochester as well as expansions at 3M and Toro and the new Minnesota operations of Shutterfly, which is setting up a facility in Shakopee. In conjunction with the Mayo project, Dayton said he plans to work with the University of Minnesota’s medical school to bring it back to national prominence and establish Minnesota as the “Silicon Valley” for health care.

Dayton even thanked the Vikings for “renewing their commitment to Minnesota,” despite weeks of tension between the governor and the team owners over funding for the project and the cost of personal seat licenses in the new venue. “This is a bad time to talk about a new football stadium,” Dayton said. “But it will be much better when thousands of Minnesotans are working to build it.”

Mixed relationship with Dayton

“I thought he was terrific,” Minnesota Business Partnership executive Director Charlie Weaver said after the event. “He talked about things that we care about, like education and obviously economic development, and he spoke from the heart. He reflected what a lot of our members feel, and that is that they grew up here, they are Minnesotans, they love the state. He acknowledged that we have differences of opinion on how we achieve things, but also reflected that we all share the same goal. At end of the day we’ve got to work together, and if we do, we can solve almost anything.”

Dayton and business groups also came together during his first term to pass a bill that sped up environmental permitting for businesses. In addition to repealing the business-to-business taxes next session, Weaver says business groups also want to continue work with the governor’s administration on simplifying state laws and regulations in areas including the environment, telecommunications and medical devices.

Republican operative Ben Golnik, who leads a political advocacy group, the Jobs Coalition, says business leaders have been frustrated in negotiations with Dayton, but they’ve learned to work together to accomplish mutual interests over the years. “I think that people in the Chamber and the Business Partnership, they represent Minnesota-based companies who provide tens of thousands of jobs, and my sense in talking to them is they are just baffled by how little Gov. Dayton understands about how the private sector economy works,” Golnik said. “But it’s also the reality that he is in the governor.”

US BanCorp chairman and CEO Richard Davis, who has been to the governor’s home and worked with him in negotiations surrounding the Minnesota Orchestra, described Dayton as a “frustrated hockey goalie.”

“It’s a thankless job. No one ever comes up and says, ‘Hey, thanks for all the saved goals,’” Davis said. “You are always just there to defend, always there to protect, and more often than not you are not thanked and not congratulated enough.”